Yahoo Finance Canadian prairies named best place in the world for mining investment
Mining may no longer be the driving force that it used to be for the Canadian economy, but a new survey by the Fraser Institute says the country is home to the best regions in the world to dig for buried treasure.
The Vancouver-based think tank ranks Saskatchewan and Manitoba as the top two jurisdictions in the world for investment in mining, displacing Western Australia, which fell from first to third in the survey.
The Fraser Institute produces the report annually, surveying executives from mining companies around the world on the best regions, based on a combination of government policy and geologic attractiveness. This year’s report was based on 350 responses from companies in 104 regions. More than half of the respondents were executives at small explorers, and just under 20 per cent were from mining companies with revenue of more than US$50 million a year.
The survey cited favourable tax regimes, clarity around environmental regulations and land-claims, as well as efficient permitting procedures for pushing the prairie provinces to the top of the list.
“Time is money, and if permit approval times are unnecessarily long or lack
transparency, confidence plummets, overall costs increase and investors will take their money elsewhere,” says Taylor Jackson, a senior policy analyst with the Fraser Institute and co-author of the study.
Also finishing in the top ten was Quebec at 6th place, climbing two spots from the previous year’s survey. Overall, Canada was ranked the second best country globally for mining investment, trailing Australia.
The report should provide some optimism for a Canadian industry that’s been just recently emerging from a years-long slump brought on by a combination of weak metals prices and increased competition from emerging mining territories in Africa and Asia.
Since hitting a low ebb in late 2015, gold prices have rebounded somewhat, while copper is up sharply over the past 6 months.
Not every Canadian region improved its ranking; Ontario slid to 18th from 15th a year ago, while British Columbia dropped to 27th from 18th.
“The two policy areas that continue to significantly hamper British Columbia are uncertainty concerning disputed land claims and uncertainty over which areas will be protected,” the report said. Several of the jurisdictions ranked worst were in Argentina.
Exploration hotbed
While “rocks and trees” no longer drive the Canadian economy the way they did 50 years ago, the country is still a mining hotbed, particularly among small exploration companies that base their operations here to take advantage in long-built expertise in mining law and financing.
But it also is struggling to keep up to date with changing investor attitudes around environmental impact and the behaviour of Canadian miners in foreign countries.
Last year, the Conference Board of Canada graded Canada ‘D’ for its environmental performance, ranking it 14th among 16 countries surveyed. Only the United States and Australia, which both ranked high in the Fraser Institute study, scored worse.
Anne Johnson, an assistant professor of mining at Queens University, said the industry is coming around to the notion that it has to do a better job in its environmental performance and working with local communities, even though that likely carries higher costs.
“I think industry has accepted this. I think if you were to talk with any vice president of sustainability at any of the big Canadian companies, they can give you long stories of the consultations that they have with the communities where they’d like to work,” she says.
“Cities in Canada were largely built by mining. Now we’re aware that, okay it’s great that the cities benefit from mining, but what about the people in the communities where the mines are located. “
The survey is sure to be a topic of discussion at the Prospectors and Developers Association of Canada convention – the largest gathering of mining companies in the world – which begins on Sunday in Toronto.
